Average fixed cost:
A) remains constant and doesn't vary with output.
B) increases as output increases.
C) decreases as output increases.
D) equals total cost divided by output.

Name: Average fixed cost: A) remains constant and doesn't vary with output. B) increases as output increases. C) decreases as output increases. D) equals total cost divided by output.
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Question

Quizplus · Accepted Answer

Average fixed cost decreases as output increases because fixed costs are spread over a larger number of units.

Average Fixed Cost